GOLD PLUMMETS - SPOT CHART

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[Fitzcarraldo]

Source: www.kitco.com

[#3Fan]

Good lord. Where to begin? Most of the capitalist western world are students of Smith, he was the champion of government non-interference. You should at leats take the 10 minutes to go to the link I provided and read chapter 4.

If he said things like "gold has no intrinsic value", I'll stick with my own intuition. I don't need anybody to tell me government intervention is bad, it's obvious.

As for gold lack of intrinsic value, jewelry is not an instrinsic value "industry", it's decoration.

The element is used in industry and jewelry, it has intrinsic value.

And up until the electronics industry was inventented there was no productive industry using gold, and even in electronics the gold uses are slim because of the cost and lack of tensile strength, molecular copper is better for most things.

Actually gold use in industry is rising rapidly. Looks like you've been reading too much of some other fool.

In the world of ecomonic analysis intrinsic value is determined by what's sometimes called the Crusoe, that being to aks the simple question "would it be useful for Robinson Crusoe", or another way to put is "if there were no society, and thusly no economy and all that it implies, would the item still be desirable".

Oh freaking brother! Robinson Crusoe?! You are a nutcase! LOL Who taught you that? Smith? Get your nose out of those silly books. That's hilarious!

Without trade gold is useless, thus it has no intrinsic value.

The element is used for jewelry and industry, therefore it has intrinsic value.

Really you're beligerent deliberate ignorance of the founding father of economic analysis tells us everything we need to know about you. The fact that you'r PROUD to know absolutely nothing about Smith shows that you are truly doomed to eternal ignorance.

At least I don't base economic theory on a sheepherder stuck on an island. LOL

Oh, and before you try to hang that ship on me one more time let's not forget about your constant insistance that a 7 story building is a "shed". Please.

131x131x20h is not a seven story building, silly. What father of architecture taught you that? LOL

[#3Fan]

No, what it demonstrates conclusively is the variability of the value of gold. It has never been consistent except when guaranteed by a government.

I've never denied inflation or deflation. I don't consider a fraction of a percent rate in either direction bad at all though. Especially when our fiat money sometimes hits 12%.

[discostu]

Uhh, so all that inventing of things like space vessels and the microchip was not "innovation". All of the technology you are now using to be an annoying uneducated twit, except the telephone if you're using dialup, was first invented or perfected in that "downhill" 50s thorugh 70s you mention. Now during the Carter administration we completely lost our way and Reagan saved us from that and certain other missteps we took during the era you mention. But to say that time period lacked innovation is to live in total ignorance.

[#3Fan]

oh-raa

:^)

[#3Fan]

Uhh, so all that inventing of things like space vessels and the microchip was not "innovation".

Spain did this in the 1600s?

All of the technology you are now using to be an annoying uneducated twit, except the telephone if you're using dialup, was first invented or perfected in that "downhill" 50s thorugh 70s you mention. Now during the Carter administration we completely lost our way and Reagan saved us from that and certain other missteps we took during the era you mention. But to say that time period lacked innovation is to live in total ignorance.

I was comparing the 50s to the 70s, I didn't say the 50s were bad. Productivity slowed greatly because of bad economic policy during the 60s and 70s. Reagan released the great American businessman and entreprenuer to do their wonders by good economic policy and got productivity and innovation back on track. I'm sure Spain had a little bit of innovation in those 150 years, but they couldn't keep up with Britain, who were doing more working than stealing.

[discostu]

He didn't say gold has no intrinsic value, in the chapter I've refered you to he discusses the history of money and why we moved away from metal money. It's other economists, like every economist that's every analyzed these things, that say gold has no intrinsic value.

Again, jewelry isn't an industry it's decoration and does not show intrinsic value. In the 80s there was a breif fad in northern Mexico to tie live beetles to a pin and pin them on you, it was jewelry, are you going to tell me that beetles had an intrinsic value because of that? And the electronic uses of gold only date back about 50 years. Meaning for 4950 years of recorded human history it had NO intrinsic value, and now it has a little intrinsic value, but again molecular copper is better. Find me another industry where gold is actually used.

Sorry hos. By every definition used for instrinsic value by economists throughout history. Gold doesn't have any. Stamping your feet and yelling "it does it does" won't change the basic reality of the situation. It doesn't.

[discostu]

Good lord man, can you at least understand what you write. Here's you in post 299:
Decades is all it takes for a society to die after they quit innovating. Look at us between the 50s and the 70s. We were going downhill in a hurry until Reagan.

Clearly you are saying that we did not innovate in the period from 1950 to 1980. Clearly that would be utter hogwash. you weren't comparing the 50s to the 60s, you weren't talking about productivity, you weren't talking about economic policy. You said there was no innovation in that 30 year time frame.

that's it. No more wasting my time on you. You can't even understand what you said 5 minutes ago. You're a lost cause. Goodbye, good lck, maybe I'll give you a buck when I see you begging on the street corner.

[justshutupandtakeit]

Saying that a gold standard leads inevitably to an inadequate money supply is not the same as saying "history was terrible before fiat money." That is just a silly misrepresentation of my view.

Hamilton was no one's front man. He was one of the most insightful, original thinkers who ever lived and his financial program was brilliantly conceived and executed much to the benefit of the new nation. There were no "monied interests" behind the 1st National Bank. The fact there was very little money here made the Bank a necessity for developement.

The market recognized its genius since American debt immediately became as good as any nation including far more powerful ones. I have never indicated my "conceptions" of a fiat banking system only attempted to clarify misstatements and distortions of reality spread by the goldbuggers.

Rothbard couldn't sharpen Smith, Ricardo or Mills quills and I have never seen anything indicating that he is more than a economic hack. Von Mises I have a great respect for though not agreement with but I doubt if you have ever read The Theory of Money and Credit.

Smith refers several times to the ability of banks to increase the wealth of a nation in the WoN. He is principally refering to the improvement in circulation of the MS that banks allow and the increase in efficency caused by not relying on gold/silver. Page #s supplied on request. Operations and history of the Bank of England or the Bank of Scotland were hardly "foreign concepts" to him.

Ricardo was a speculator and broker and also well understood the necessity and operation of the BoE after all he was a member of parliament. Are you really unaware of these facts or just attempting to be mendacious?

You are correct England was not forced to charter the BoE it could have just allowed the lack of specie to collapse the economy and produce enormous distress and misery. Smith called the BoE "a great engine of state" because it allowed state policy to be carried out so much more easily than without it. Including the policy of increasing the wealth of the nation.

Well lets examine the opposition to the Bank. Jefferson was an economic illiterate and was totally confused about finances and economics. This was a man who believed this should be an agricultural nation without a navy. But even he shut up about the Bank when elected president.(He claimed Hamilton "duped" him wrt the Bank. Madison could not prevent the radicals in his party from refusing recharter of the Bank even though it caused the government incredible difficulties and brought ruin on the nation. He didn't push for non-recharter. Monroe saw what had happened and even the fire-eaters had to allow recharter so he had little to say in opposition after reality set in. Jackson was a true fanatic and destroyed the Bank resulting in a tremendous depression throughout the nation. As a result of the lack of a money supply thousands of wildcat banks sprang up foisting millions of worthless currency on the nation. Fraud was rampant so much so that bank notes were not valid in different states and the notes of the defunct Bank were still considered the most valuable money.

Most of the opposition to the Bank was ideological and not based upon any understanding of Banking, money, finance or economics. Those presidents opposed were lawyers/farmers and ignorant of such matters.

As is the case with most amateur experts you ignore one of the most crucial aspects of monetary systems and that is the velocity of circulation of money. Business activity itself affects the amount of money available. When it is rapid the MS grows when it slows down it shrinks. Where is the determination of the appropriate degree of scarcity made? How is it determined that a region has too much or too little when gold is used and always gravitates to the large cities and wealthy countries? You really believe a government is going to stand aside and watch its people die because there is no gold to carry business? Of course, it won't and this is why there never was a true gold standard. When it caused difficulties it was ditched in practice if not in theory. Isn't it interesting that the most wealthy nations are precisely those which have money supplies from central banks.

Only to those who know little of history are we moving backwards, accurate analysis without ideological bias demonstrates that non-metal money never worked and never can in a world economy. It was just another fable.

[justshutupandtakeit]

Gold might never go to zero but if you take the current value and depreciate it by 1% per yr. how long does it take before its value is a penny an ounce? Today I can buy 3x as much of it as in 1980 with my dollars.

I have no argument about keeping it as a store of value though since in that regard it is fairly safe. If not totally. Hell those who are still holding confederate money have seen it return to value.

[#3Fan]

He didn't say gold has no intrinsic value, in the chapter I've refered you to he discusses the history of money and why we moved away from metal money. It's other economists, like every economist that's every analyzed these things, that say gold has no intrinsic value.

It is used in industry and jewelry, and therefore has intrinsic value.

Again, jewelry isn't an industry it's decoration and does not show intrinsic value.

I'll tell that to the jewelry store owner up the street here and see what he says about jewelry not being a real industry. LOL

In the 80s there was a breif fad in northern Mexico to tie live beetles to a pin and pin them on you, it was jewelry, are you going to tell me that beetles had an intrinsic value because of that?

If they were selling them for that they did.

And the electronic uses of gold only date back about 50 years.

So there's a certain time of probation?

Meaning for 4950 years of recorded human history it had NO intrinsic value, and now it has a little intrinsic value, but again molecular copper is better.

It has been used for jewelry, eatingware, since man first found it and has intrinsic value.

Find me another industry where gold is actually used.

Dentistry, medicine, sun visors, eatingware, doorstops, suits, gravitation meters, architecture, roofing, finance, bullets.

Sorry hos. By every definition used for instrinsic value by economists throughout history. Gold doesn't have any.

The element is used in jewelry and industry and has intrinsic value.

Stamping your feet and yelling "it does it does" won't change the basic reality of the situation. It doesn't.

Denying the history of it's uses above won't change reality either.

[justshutupandtakeit]

Spain was never a country of innovations for several reasons and that had nothing to do with its decline as a world power.

We were not rapidly going downhill before Reagan and were innovating rapidly during all that period you named.

Where do you get the idea that Spain ever exported much of anything? It didn't and was never an economic power.

Your "lurch" comment lurches into insensibility. I have no idea what you mean.

How do foreigners get rich off the Fed.? How do Germans give us our money? We have a trade deficit with them so we are sending them our money not the other way around. Same with the Japanese.

Miners now are women too and those jobs are still hideously hard and dangerous. What the Marines have to do with this is beyond me but I am not surprised they were dragged into your posting.

[#3Fan]

Good lord man, can you at least understand what you write. Here's you in post 299: Decades is all it takes for a society to die after they quit innovating. Look at us between the 50s and the 70s. We were going downhill in a hurry until Reagan. Clearly you are saying that we did not innovate in the period from 1950 to 1980.

Nope I said there was a change between the 50s and 70s that put us on the path of noninnovation. What was different between the 50s and 70s? Liberalism increased to the point of strangling our economy and therefore the pace of innovation.

Clearly that would be utter hogwash. you weren't comparing the 50s to the 60s, you weren't talking about productivity, you weren't talking about economic policy. You said there was no innovation in that 30 year time frame.

Now I see why you have no ability to understand economics. You brain isn't wired right if that's what you get out of that simple-to-understand statement I made.

that's it. No more wasting my time on you. You can't even understand what you said 5 minutes ago. You're a lost cause. Goodbye, good lck, maybe I'll give you a buck when I see you begging on the street corner.

Don't hold your breath. LOL By the way, is that something Robinson Crusoe would say? I think not! ROFL

[justshutupandtakeit]

In the last decades of the 1800s the U.S. money supply shrank by at least a third and deflation was a gigantic problem leading to the creation of several political parties trying to deal with its crushing impact on the farmers and the west. It was not a percent here or there.

[Fyscat]

why does everybody always bring up 1980? it was a hyped inflated market very much like the dow present day( unless you like pro forma instead of gap)Yes, one must look at all aspects, and I dont like bullion anyway, its a market where the fix is in utilizing the futures market. I believe in other area's of gold that the gov't has deemed "of unusual value". I avoid a bullion piece that issued today has $50 stamed to it.(a confiscation issue)

[#3Fan]

As is the case with most amateur experts you ignore one of the most crucial aspects of monetary systems and that is the velocity of circulation of money. Business activity itself affects the amount of money available. When it is rapid the MS grows when it slows down it shrinks. Where is the determination of the appropriate degree of scarcity made? How is it determined that a region has too much or too little when gold is used and always gravitates to the large cities and wealthy countries? You really believe a government is going to stand aside and watch its people die because there is no gold to carry business? Of course, it won't and this is why there never was a true gold standard. When it caused difficulties it was ditched in practice if not in theory. Isn't it interesting that the most wealthy nations are precisely those which have money supplies from central banks.

You know what the biggest advantage fiat money has over gold?.......It's manipulatable.

Do you know what the biggest disadvantage fiat money has compared to gold?.......It's manipulatable.

[#3Fan]

In the last decades of the 1800s the U.S. money supply shrank by at least a third and deflation was a gigantic problem leading to the creation of several political parties trying to deal with its crushing impact on the farmers and the west. It was not a percent here or there.

What was it then?

[#3Fan]

In the last decades of the 1800s the U.S. money supply shrank by at least a third and deflation was a gigantic problem leading to the creation of several political parties trying to deal with its crushing impact on the farmers and the west. It was not a percent here or there.

What was it then? It took decades to shrink by a third? That doesn't sound bad at all. Inflation runs higher than that now, doesn't it? Looks like we had more problems than currency. Looks like there was a railroad bubble or something. LOL

[justshutupandtakeit]

No this was the attempt to return the U.S. to a gold standard which destroyed the greenbacks and shrank the money supply. Loans taken out by farmers in 1870 became unrepayable when the money supply shrank and prices fell as a result. If your loan is at a 5% interest rate and the return to gold causes prices to fall by 5% a yr. your "real" interest rate is doubled while the prices of farm products collapse destroying the revenue stream to repay them.

It was these problems which provoked the farmers to demand a central bank to remove monetary control from the hands of the eastern money center banks. Bankers resisted any idea of a central bank until the Panic of 1907 made them realize that there wouldn't always be a J.P Morgan available with the ability to stop a panic and its runs on banks.

Review U.S. history from 1875 to 1900 to get a clear idea of what happened here.

[#3Fan]

Spain was never a country of innovations for several reasons and that had nothing to do with its decline as a world power.

They gave Britain a run for their money before they started stealing gold.

We were not rapidly going downhill before Reagan and were innovating rapidly during all that period you named.

Yeah right. Productivity was going way down. Japan was gaining on us so fast they began buying up our country's real estate. Our cars were falling apart. Bad economic policy is bad for business, and what's bad for business is bad for innovation.

Where do you get the idea that Spain ever exported much of anything? It didn't and was never an economic power.

The indusrtial revolution passed them by because they were too busy stealing gold to worry about actually learning industry.

Your "lurch" comment lurches into insensibility. I have no idea what you mean.

Britain lurched ahead of Spain by industrializing to get Spain's gold.

How do foreigners get rich off the Fed.?

By owning the banks that make out money. Why would private banks do the Fed's work if they weren't making a buck or two?

How do Germans give us our money?

The Fed's reserve is reserved in a collection of private banks in Europe.

We have a trade deficit with them so we are sending them our money not the other way around. Same with the Japanese.

I'm talking about the "reserve" in the Federal Reserve.

Miners now are women too and those jobs are still hideously hard and dangerous.

Women are Marines too and it gets hideously hard and dangerous to be a Marine.

What the Marines have to do with this is beyond me but I am not surprised they were dragged into your posting.

You seem to think harder jobs make people miserable, I think it makes them proud. Hideously hard. American gold mines? I think you're overdoing it a little, aren't you?

[#3Fan]

No this was the attempt to return the U.S. to a gold standard which destroyed the greenbacks and shrank the money supply. Loans taken out by farmers in 1870 became unrepayable when the money supply shrank and prices fell as a result.

So what was their excuse in the 80s when there was all that farm-aid going on?

If your loan is at a 5% interest rate and the return to gold causes prices to fall by 5% a yr. your "real" interest rate is doubled while the prices of farm products collapse destroying the revenue stream to repay them.

Deflation was 5% a year? Prove it. Even if it was, inflation was 12% a year in 1979, so inflation and deflation are not immune to fiat money, obviously.

It was these problems which provoked the farmers to demand a central bank to remove monetary control from the hands of the eastern money center banks. Bankers resisted any idea of a central bank until the Panic of 1907 made them realize that there wouldn't always be a J.P Morgan available with the ability to stop a panic and its runs on banks.

I think the FDIC program had more to do with stopping runs than going to fiat. (And now JP Morgan has $23.4 trillion dollars worth of derivatives ready to explode ant any time. The saviour becomes the destructor.)

Review U.S. history from 1875 to 1900 to get a clear idea of what happened here.

Like I said fiat is more manipulatable and that is an advantage as long as we have a decent driver. It becomes a disadvantage when we get a bad driver. What are the odds of getting a bad driver? The country elected Clinton twice, another Clinton may put someone like a Rubin in charge. Then it's bye bye currency, hello Germany 1923.